An Oldie, but not so Goodie: Updating the U.S. Poverty Measure

07/19/2009 05:12 am ET
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Updated
May 25, 2011

C. Nicole Mason
Executive Director, Center for Research and Policy in the Public Interest and Ascend Fellow at the Aspen Institute

There are only a few things that have not been updated since the 1960s -- the U.S. poverty measure is one of them. As far as statistical measures go, it's the equivalent of using the Twister board game, also invented in the 1960s, for exercise rather than the Nintendo Wii. These days, Twister just doesn't cut it when you want to burn calories fast. So why are we still using a Twister equivalent to measure poverty and economic well-being in the U.S.?

Currently, there are over 37 million people and 7.7 million families living in poverty in the U.S. -- we think. Because the current poverty measure fails to take into account the social and economic realities Americans now face, the number could be higher or lower than estimated. We just don't know. The current measure also fails to factor in an individual's geographic location and the skyrocketing costs of fuel and food, clothing and shelter.

Yesterday, Representative Jim McDermott (D-WA) introduced the Measuring American Poverty Act. The Act represents a marked improvement over old faithful. The new measure would take into consideration medical and work expenses, the current cost of food, clothing, shelter, other basic necessities, and income from public assistance programs in calculating the federal poverty rate and deciding who is poor in the U.S.

Critics of the Act worry that it would do more harm than good. They argue that there is a danger that the new measure would strip benefits away from needy families and individuals. Possibly, but not likely. The new measure would not replace the current poverty measure; it would be used as supplemental administrative tool by federal and state legislators until all of the kinks have been worked out.

Recently, there has been a lot of sexy talk about cutting poverty in half over the next ten years. The question is, how is that going to happen if we don't have an accurate measure of how many poor people there are living in our cities and communities?

Without an accurate measure, we have no way of knowing how deep the problem is or if that goal is even realistic, especially for the most vulnerable segments of our society, which include single women heads of households who currently makeup up four million of those living below the poverty line.

The Act is a step in the right direction in terms of increasing our understanding of persistent poverty and inequality in the U.S. In addition to its current provisions, the Act should include an impact assessment study to determine how the new measure would affect benefits received by individuals and families and include true costs of living expenses that are adjusted for geographic location.

Like all good things that have outlived their usefulness, the current poverty measure needs to be updated to reflect today's economic reality. America deserves better.